Collins & Aikman Corporation’s European companies have obtained a “group wide” administration order under the jurisdiction of the high court in London.
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Simon Appell and Alastair Beveridge, amongst others, of Kroll UK have been appointed joint administrators of each of the companies.
The companies included in the filing are located in the UK, Austria, Belgium, Czech Republic, Italy, Germany, Luxembourg, Netherlands, Spain and Sweden and have approximately 4,000 employees in 24 facilities.
Collins & Aikman’s European operations are expected to continue as usual while the administrators assess appropriate options.
C&A chief restructuring officer John Boken said: “Over the past two months, we have discussed a number of alternatives with all of our constituents, including our major customers, in an effort to fashion a permanent solution to our liquidity and balance sheet issues across Europe. In the absence of a permanent solution acceptable to all parties, it became evident that applying to the English court for a group wide administration order would be the best course of action to maximise value for both our European and US creditors.
“These actions will not impact our ongoing reorganisation efforts in the United States. The company’s operations in Canada, Mexico and Brazil are unaffected.”
The consolidated administration in Europe follows Collins & Aikman’s May 17, 2005 Chapter 11 reorganisation filing which covered substantially all of its subsidiaries in the United States.
The administration orders are expected to protect the businesses while the administrators review the available options for the companies’ operations, which is likely to include going-concern sales of some or all of the European businesses.
Joint administrator Appell said: “Administration is a rescue-oriented procedure and will provide the best framework to consider all the options for the businesses. In conjunction with the administration, we have arranged financing allowing us to continue Collins & Aikman’s European operations in the normal course.”
